Fri, 22 Jan 2021

Singapore, July 14 (ANI): Singapore's economy shrank by 12.6 per cent year-on-year in the second quarter as circuit breaker measures to stem the coronavirus pandemic took their toll, the Straits Times reported on Tuesday quoting advance estimates from the Ministry of Trade and Industry (MTI).

The decline in the gross domestic product (GDP) much worse than in the first quarter when GDP turned negative for the first time in a decade with the economy contracting by a revised 0.3 per cent.

MTI said the GDP plunge was due to the circuit breaker measures that were implemented from April 7 to June 1 to slow the spread of COVID-19 as well as weak external demand amid a global economic downturn.

On a quarter-on-quarter basis, the economy shrank a record 41.2 per cent in the three months to June -- entering a technical recession for the first time since 2009. A technical recession refers to two straight quarters of quarter-on-quarter contraction.

Trade and Industry Minister Chan Chun Sing said the numbers show the extent of the challenges facing Singapore amid the pandemic and the effort required to restore the economy, adding that the figures were expected, according to the Straits Times.

MTI in May forecast a full-year contraction of 7 per cent to 4 per cent -- making the current recession Singapore's worst-ever since independence in 1965.

The second-quarter slump was led by the construction sector that shrank by 54.7 per cent on a year-on-year basis, a significant deterioration from the 1.1 per cent decline in the first quarter.

The services-producing industries contracted by 13.6 per cent on a year-on-year basis in the second quarter, steeper than the 2.4 per cent decline in the previous quarter.

The only bright spot in the economy was the manufacturing sector that grew by 2.5 per cent year on year in the April to June period. However, the growth was slower than the 8.2 per cent pace achieved in the first quarter.

Singapore started to relax the circuit breaker measures on June 1 and entered phase two of economic reopening on June 19, allowing most retail shops and restaurants to resume business while observing social distancing measures. (ANI)

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